Victoria Laundry (Windsor) Ltd v Newman Industries Ltd [1949] Facts: Newman Industries Ltd was meant to deliver a boiler for Victoria Laundry (Windsor) Ltd. The delivery was five months late. As a result of not having enough laundry capacity, Victoria Laundry lost a lucrative cleaning contract from the Ministry of Supply. Victoria Laundry sued for the ordinary profit that it had forgone through not having the boiler on time. Issues: The question was whether Victoria Laundry (Windsor) Ltd. could claim the large profit it would have made, had it been able to take advantage of the lucrative Ministry of Supply contract. The legal issue here is remoteness (the limited ability of a plaintiff to recover damages to only those which are reasonably foreseeable to the parties).
Is Victoria Laundry (Windsor) Ltd. entitled to claim in respect of lost profits which they could have made if the boiler had been delivered on time?
Holding: Court held that Newman Industries only had to compensate for the ordinary losses, not the extraordinary loss of profits – distinguishing the ruling in Hadley v Baxendale [1854].
Reasons:Ordinary losses = those that arise naturally or according to the usual course of things. They are not considered remote. They are losses that a party should have reasonably foreseen. Thus, they are based on the presumed knowledge of the defendant.
